The CFPB is committed to helping the mortgage industry fully implement the pending TILA/RESPA Integrated Disclosure (TRID) rule to the maximum extent possible, and its examination approach will focus on being “diagnostic” and “corrective,” not “gotcha” oriented, a top bureau official said during an industry conference early this week. Speaking at the Mortgage Bankers Association’s 2015 regulatory compliance conference in Washington, DC, Diane Thompson, managing counsel in the bureau’s Office of Regulations, tried to reassure anxious lender representatives about the industry’s transition to a dramatically different lending environment under the new regulatory regime. “We understand that this is a major change ... that we are not going to flip some magic switch on Oct. 3 and the world will suddenly ...

As the pending Oct. 3, 2015, effective date for the CFPB’s integrated disclosure rule approaches, both the bureau and industry groups issued last-minute guides and other materials to help various sectors comply as effectively as possible. The rule is intended to harmonize and integrate the disclosures required under the Truth in Lending Act and the Real Estate Settlement Procedures Act; hence the term “TRID,” an acronym for the more formal TILA/RESPA Integrated Disclosure rule. Last week, on the lender front, the bureau released three supervisory publications that have been updated to reflect the new TRID effective date. They include the interagency TILA and RESPA examination procedures, developed in coordination with the members of the Federal Financial Institutions Examination Council Consumer ...

The CFPB recently brought enforcement actions against two large debt buyers and collectors, Encore Capital Group, in San Diego, and Portfolio Recovery Associates, in Norfolk, VA, accusing the companies of using deceptive tactics to collect bad debts. The bureau said the companies bought debts that were potentially inaccurate, lacking documentation or unenforceable. “Without verifying the debt, the companies collected payments by pressuring consumers with false statements and churning out lawsuits using robo-signed court documents,” said the CFPB. In terms of the companies’ allegedly illegal litigation practices, the CFPB accused the pair of misrepresenting their intention to prove debts they sued consumers over. They also allegedly sued or threatened to sue consumers past the statute of limitations. Further, the companies allegedly ...

he CFPB and the Department of Justice said in an amicus brief with the Supreme Court of the United States that a plaintiff does not necessarily have to prove actual harm from a violation of the Fair Credit Reporting Act in order to have standing under Article III of the U.S. Constitution. The specific question in Spokeo, Inc. v. Robins is whether the respondent (Robins) identified an Article III injury-in-fact by alleging that the petitioner (Spokeo) had willfully violated the FCRA by publishing inaccurate personal information in consumer reports – in this case, on a consumer-reporting type website – without following reasonable procedures to assure the information’s accuracy. In their brief, the CFPB and DOJ argue that the invasion of the respondent’s ...

Two nonbank mortgage lenders ran afoul of the CFPB in its enforcement of the loan originator compensation rule, and other lenders would do well to learn from their experiences. During a recent webinar sponsored by Inside Mortgage Finance, an affiliated newsletter, former CFPB official Benjamin Olson, now a partner at the law firm of BuckleySandler, talked about two related enforcement actions the bureau brought against California-based nonbank mortgage lenders, Franklin Loan Corp. in November 2014 and RPM Mortgage, Inc., in June of this year. Both cases zeroed in on the lenders’ use of expense accounts to pay originators’ bonuses and commissions. The practice cost Franklin $730,000 and RPM $19 million. Olson noted the CFPB allegations were based on expense accounts ...

The Consumer Mortgage Coalition recently told the CFPB one way to improve the bureau’s proposed regulation having to do with “successors in interest” is to eliminate the requirement to make successorship determinations when they are not necessary. The CFPB’s goal in this regard is to make loss mitigation more available to successors. However, the CMC said in a recent memo to the bureau that loss mitigation does not always require a successorship determination. “If a claimant ... cannot keep the loan reasonably free of default and the servicer will not pursue due-on-sale enforcement, there is no per se need to determine successorship,” said the trade group. “Of course, there may be a need to determine loss mitigation. Loss mitigation may ...

In a report sure to be embraced by industry critics of the CFPB, the bureau’s Office of Inspector General said the agency needs to improve its management of its consumer complaint database. “We identified areas in which management controls should be improved to enhance the accuracy and completeness of the consumer complaint database,” said the OIG in a recent report. For instance, the bureau’s Office of Consumer Response “has implemented controls to monitor the accuracy of complaint data in the internal case management system, which contains all consumer complaints received by the CFPB, but it has not established separate management controls to ensure the accuracy of data extracted from the system and included in the consumer complaint database,” according to ...

Two of the biggest lenders in the land saw consumer complaints about their bank accounts and bank services rise by double digits during the second quarter, outpacing the overall industry, which saw a more modest increase during the period. An analysis by Inside the CFPB found that Bank of America and Wells Fargo experienced increases of 20.3 percent and 13.2 percent, respectively, from the first quarter of 2015 to the second quarter. Year over year, BofA saw a more moderate rise of 6.4 percent in consumer criticism, whereas Wells actually saw a 12.5 percent drop. ...

Two of the top three entities associated with money transfers saw complaints against them leap by double digits, both in the second quarter and for the first half of the year, according to a new analysis by Inside the CFPB. The top target of criticism, MoneyGram, saw complaints jump in this regard 53.5 percent and 84.7 percent, respectively, while third-ranked PayPal experienced surges of 47.1 percent and 51.8 percent, respectively, for the two time periods measured. However, second-ranked Western Union saw just a slight uptick of 3.1 percent in the second quarter, and a modest downturn at the mid-year mark versus a year ago, 3.0 percent. ...

Bureau Wants Public Input as it Requests OMB Approval of Consumer Survey of ATM/Debit Card Overdraft Disclosures. The CFPB is soliciting public comment as it seeks authorization from the White House Office of Management and Budget to carry out a national online survey of 8,000 individuals as part of its review and analysis of ATM/debit card overdraft disclosure forms. “The survey will explore consumer comprehension and decision-making in response to revised overdraft disclosure forms,” the bureau said in a recent Federal Register notice. “It will also explore financial product usage, behavioral traits, and other consumer characteristics that may interact with a consumer’s experiences with overdraft programs and related disclosure forms.” The survey will include a representative sample of the U.S. ...